BUDGET: The key parts you need to know...

Chancellor of the Exchequer George Osborne outside 11 Downing Street, London, before heading to the House of Commons to deliver his first Tory-only Budget. PRESS ASSOCIATION Photo. Picture date: Wednesday July 8, 2015. See PA story BUDGET Main. Photo credit should read: Yui Mok/PA Wire

Published:16:55Updated:18:18Wednesday 08 July 2015

Chancellor George Osborne’s emergency budget, the first by a Conservative-only government for nearly 20 years, was announced today.

Mr Osborne used it to introduce a much-needed boost to the country’s work-force, dramatically declaring that ‘Britain deserves a pay rise’.

Hailing a new ‘higher wage, lower tax, lower welfare’ Britain, the chancellor said from next April everyone over 25 would be entitled to £7.20 an hour - and the figure would rise to £9 by 2020.

Some six million people will see their pay increase as a result - and those currently earning the minimum wage of £6.50 an hour will be £5,000 better off by 2020, he claimed.

Mr Osborne said he was following the Conservative tradition as the party that brought in protections for mill workers during the industrial revolution.

‘Taken together with all the welfare savings and the tax cuts in this Budget, it means that a typical family where someone is working full-time on the minimum wage will be better off,’ Mr Osborne told MPs.

But acting Labour leader Harriet Harman responded by claiming the Budget was ‘making working people worse off’ by cutting tax credits for the low paid and grants for students from poorer backgrounds.

How will this budget affect you?

Here are the main points:

* New National Living Wage for over-25s, starting at £7.20 from April 2016, rising to £9 by 2020.

* Public sector pay will increase by 1% each year for the next four years.

* Household benefits cap will be reduced to £20,000 outside of London where it will be £23,000.

* Working age benefits to be frozen for four years, including tax credits and housing benefit, but not maternity allowances.

* Child tax credit limited to two children for those born after April 2017.